Are Publishers Putting Too Much Stock In The iPad, Or Are They Just Doing It Wrong?

from the either-way-their-hopes-are-too-high dept

Jim Lillicotch points us to a post by MediaPost blogger Steve Smith, who was surprised by his 18-year-old daughter's immediate dismissal of the iPad. It may be, as he speculates, an omen of the device's future in general, but he also makes some points specifically related to the publishing industry that are worth highlighting.

"I need a keyboard. Even my phone has that." It is really all about input for her, and her focus on interactivity underscores a glaring limitation of the iPad. It is primarily a media consumption device, not an interactive device. Publishers think of digital merely as a delivery vehicle, but users think of digital as a communications and interactive platform. After a life of leaning in, why would she want to lean back and consume content just to make media companies' business models work for them?

Smith lists several drawbacks to touch-screen tablet input that probably haven't occurred to those who, like me, have never gotten the chance to use one. I still think that with the right interface and after some design iterations, iPads (and other tablets) will be excellent interactive devices, but Smith is dead right in his assessment of how publishers view them. The iPad magazine demos that some have shown off are compelling and cool, but they are mostly one-way media. This is exacerbated by the obsession with native apps, which Smith notes are much less likely to explode on the iPad the way they did on the iPhone:

Unlike the iPhone, where an app can clearly trump a mobile Web site experience, the iPad makes full Web browsing much more viable. Early audience research I have seen suggests that for even those interested in the iPad, Web browsing and email are rated far above app downloads as the device's main attraction. And so, publisher apps will be competing with their own Web sites.

This is a point we've made before: everything in these fancy magazine apps can be replicated in the browser (there is one small problem to do with scrolling that remains, but even that has nearly been solved). Publishers should be working to ensure that their product—whether it's books, magazines or newspapers—is available on every platform with minimum hassle, instead of building closed apps that frustratingly trap the user. Nobody is loyal to one publication anymore, and nobody wants a dozen different news and magazine apps littering their tablet or smartphone—they want to browse the web the way they always have. It's time for publishers to stop trying to alter user behaviour, and start learning from it.

"We own our customers."

This seems to have become the motto of just about every business on the planet, but it's particularly egregious in the case of the "content industries." DRM, paywalls, restrictive legislation bought with thinly-disguised bribes, Chinese-style censorship (ACTA), etc. etc.

And I'm not sure they understand that, unlike the banking/financials, there will be NO bailout, the money already having gone "404".

Smart young lady, that guy's daughter. I think Apple have finally made a few too many bad design calls to overcome with slick marketing this time; the iPad's sales figures are likely to be a painful lesson.

lack of keyboard

the whole reason touch only is pushed by manufacturers (the real reason), is that they feel it will make devices harder to hack.

What not having a keyboard really means is a significant loss of functionality for the user. No matter how "wonderful" a touchscreen is, or how reliable, or accurate it still doesn't take away from that if you don't have a keyboard it's absolutely horrendous for normal tasks.

Wired

Having just read the article in Wired (who wants to go all in with the iPad) I thought the Fake Steve Jobs Essay was a perfect response to publishers hoping to make money off micropayments and subscriptions. And why would we want all these apps for each publication, wouldn't we like one or two that bring it all together for us instead of managing twenty plus feeds? Sort of like iGoogle already does for me.

Re: Re:

I'd like to see an *honest* breakdown of costs of creating a hard/paperback book: manufacture, distribution, maintenance of book making machines, labour, etc. Then I'd like to see the cost breakdown of the digital version of the same book.

I understand that $10 is not a lot of money, but I'm betting most of the $10 is pure, infinitely scaling, profit that lines the publisher's pockets and not the author's.

Re:

What things? When it comes to multimedia publishing, I think you'll find that there is very little that cannot be replicated in the browser.

This post isn't about the "browser as OS" question, it's specifically about the best platform for publishing. Did you launch a Techdirt app to get here, or did you simply plug in the address? Would you like to have apps for every blog, newspaper and magazine you read online?

Consider all the things that readers can't do inside apps: easily sharing links through facebook/twitter, jumping back and forth between multiple sites/sources while writing a blog post, quickly grabbing a paragraph of text to quote somewhere else... Basically, apps break ALL the things users are used to after years of consuming news and information online.

Will browsers replace apps entirely? I'm not really sure, though Photoshop Online and similar services have convinced me it's possible. But when it comes to publishing I can't think of a single sensible reason to lock content up in a native app when the web already presents a powerful open platform.

Re: Re:

i agree with you up to the last sentence. The web isn't "open" i, for one, can't use netflix streaming. Why? is it because I live out side of the US? nope. It is simply because the OS my browser sits on is Linux-based, not Windows or OSX. The web may be more open than native apps, but it is NOT an open platform.

I agree with Little 'Miss Independent'

The iPad is not something I will purchase. I think this desperation and frantic this will save us attitude oozing from the news paper and magazines is going to lead them to a major disappointment.

Peoples habits have changed, they have gone back to how they were pre printing press, where you got news from multiple people and talked and commented on what you have heard. Basically we have had 560 years (1450 AD invention of the printing press) of print distribution as a blip in an evolutionary history going back a million years. It is in our nature to socialize, it is a survival trait, it is genetic. Now that there devices and web based apps to socialize and comment, spoon fed non interactive media is slowly disappering.

Its one of the things that newspapers and magazines dont get. It took 6-12 hour for a comment I posted on the LA Times to show up. I am wondering how many people had to authorize its posting. That sort of behavior doesnt breed any sort of community, loyalty, or brand loyalty. Until they get that they will continue to slowly crumble as an industry. Wired on the other hand is beginning to get it right.

Re: Re: Re:

Indeed there is a massive thicket of cross-platform issues that web designers must deal with, and that Linux specifically gets left behind on occasion - but the web is still a very open platform. It is based on a handful of formats (HTML, CSS, common image formats) that are among the most widely supported in the world. It's with newer technologies - mainly video - that most of the cross-platform issues crop up, and in that area there is a constant push for greater platform penetration, especially now with HTML5 on the scene.

But that's not even the part of "openness" that I'm talking about. Native apps don't even communicate with other native apps half the time - when you click a link in the Wired magazine app, for example, it keeps you locked in an internal browser instead of sending you to Safari. And you can't link TO articles in these apps either. Meaning no sharing on Twitter, no linking from blog posts -- it's not even easy for users to bookmark websites they find through the app. So no word of mouth, no going viral. That's the kind of web openness that I'm talking about, and the kind that native apps completely cut you off from.

The iPad is a nice idea... I already have it and it is called the iPod Touch. Yeah the iPad is bigger but that is about it. It needed value added features to make it unique - IE: Camera, GPS, SD slot, etc. The iPad also lacks a real useful screen to use it as an ebook. So I see no advantage of it.

Now package the iPod with a Camera, GPS, SD slot, and a screen that is suitable for long term ebook reading as well as a being a good 5X7 screen and I would buy it in a second. I can live with a touch screen key board. As it stands there is not real reason for me to buy the iPad.

Re:

"I doubt even Steve Jobs believes it'll save the newspapers."

It wont but he will sell them on the idea that it can. Just like iTunes can save the music industry. His job is to sell iPads not save the newspapers or magazines. That is something Rupert Murdoch and other media types should keep in the back of their minds when ever dealing with Apple.

Don't be so negative (yet).

I agree that publishers SHOULD be working to make their iPad style content available for all platforms but I have no reason to doubt it will at some point. For argument's sake, lets say the special iPad content is hugely successful. At some point, the publishers are going to want to grow their audience and their business and move beyond Apple. Similarly, they'll want to control their own distribution (bypassing the App Store or Apple's 30% cut) and they'll expand their offerings. Of course, if the iPad content fails, then we go back to what we have today.

And despite their past performance (which as we know isn't indicative of future results) I'd like to think they'll want to increase their "circulation numbers" as much as possible even if they have to extend their fancy offerings to non-iPad users.

And if they don't want to increase their circulation, well, then you can give up on them and let someone else capture their audience

Re:

"Now package the iPod with a Camera, GPS, SD slot, and a screen that is suitable for long term ebook reading as well as a being a good 5X7 screen and I would buy it in a second. I can live with a touch screen key board. As it stands there is not real reason for me to buy the iPad."

Which is why I'm now quite interested in the Notion Ink Adam. pretty much fits your description, but with a 10" screen (perfect for technical books).

Re: Re: Re:

Sure, if by "honest" you mean assigning all of the fixed costs -- offices, staff, marketing, legal, etc -- to the physical good, and only look at the variable costs of the digital good. You will definitely get the result you're looking for that way.

I would be very surprised if the variable costs for a moderately selling paperback exceed $1. The digital equivalent, of course, is close to $0. But a fair assignment of overhead to each almost certainly brings their total net cost into a very similar range.

Screenage

The e-reader use case of the iPad seems to be getting a lot of play, but to me it looks like one of the weaker aspects of the product. Will the iPad screen be readable outside, in daylight? The current crop of e-ink based readers (Sony Reader, Kindle, etc) all excel there.
Apple seems to be rounding up and facilitating book content delivery -and honestly that's a much needed service- but screen "readability" issues are, to me, the key to reader utility.

As a "big iPod Touch" the iPad looks great, and is something I'd be interested in just for that. But after a decade+ of ereader usage, on a variety of mostly backlit devices including phones, PDAs, laptops, netbooks and many of the dedicated ereaders that have come to market, I'll just stay with e-ink for reading. Too bad Apple didn't equip the iPad with an e-ink screen on the reverse side...

I'm going to disagree

I think we may be in for a surprise, and I think native, per-publication apps may very well see substantial success. Here's why:

- Users don't care about the difference between a native app and a browser. If switching between apps gets better, it's just not going to matter.

- Native apps are designed with very well known device parameters. A web app has to scale between different devices, expect different input devices, different CPU and GPU capabilities, and so on. Native apps allow for standardization and higher (perceived) quality.

- Publishers are more likely to invest in easily monetizable products. Spending $1M on a native app can be justified by looking at price points, expected retention, and so on. They might be *wrong* but at least "how are we going to make money from this" is easily understood, at least compared to trying to justify spending $1M on a new web site.

- iPhone/iPad/iPod offer a very low transaction cost to the user. Your credit card is already on file; it's two clicks to pay and you get immediate gratification. Publishers don't have that option on the web

I think some of the arguments against iPad's success are based on wishful thinking -- content *should* be open, users *should* reject vendor lock-in, open standards *should* produce just as robust an experience, etc. But I'm increasingly convinced that actual reality may make iPad an attractive solution for consumers.

Re: Screenage

I suspect Apple knows this, and they also know that it won't be too long before we have screens capable of displaying readable text AND also playing video and browsing the web and so on--in fact I'd bet that the iPad will have such a screen within three or four generations.

But as it stands the problem with screens is, your choice is between "Good For Reading, Virtually Unusable for Everything Else" or "Good For Everything Else, Still Not Terrible For Reading"

Apple knows the future is in single devices that do everything you need, and as far as I can tell they see no reason to waste time on eReaders when they are clearly going to be absorbed into Tablets within a few years.

These devices will not take off entirely until they stop crippling them.. And it is going to take some real competition before that happens, and unfortunately the competition is choked by patents.. So basically we end up with hardware surgically crippled to try to make apple more money because they are guarenteed a monopoly anyway.

Re: Re: Re:

[Full disclosure - I am an independent digital strategist who works exclusively with authors and publishers. I am also a rather ardent supporter of eBooks and the potential they can bring.]

With regards to an honest breakdown of costs, there's been a couple done, but the problem is that costs differ from book to book even at the same publisher. However, the generalized cost for a priced eBook at $26 is as follows:

Footnotes
1 - Note that none of the author royalties are paid until the initial investment "earns out," that is, the author won't see any royalties until the advance from the publisher is fully recouped.

2 - Author royalties, while reasonably higher in electronic format (25% in eBook compared to 15% in hardcover, ~13 in trade paperback, and ~7.5% in mass market paperback), are variable because the debate has yet to be settled on which number the percent is derived from: list or net price. Current, most publishers are paying net, which means the author receives the lower royalty while the publisher earns the higher profit.

3 - The numbers that Motoko quoted for the $9.99 eBook in the source listed above are if the book is sold for $9.99 under the agency model. This set of data represents the current setup for eBooks sold on the Kindle under the wholesale system.

4 - I starred this number, as I've yet to see a major push by publishers to highlight the availability of the Kindle edition in anyway other than included with print announcements. If you take this number out of, under the current system, publishers earn more profit on a Kindle sale than the list price.

Granted, none of those numbers include incidental and fixed costs - office space, utilities, salaried staff, or unrecouped debt from the 70-90% of books that fail to earn out. However, this estimate also does not take into account rolling, continual, long tail profits from books that have earned out. So, there is a lot of room for fuzz with these numbers.

Re: Re: Screenage

Yep, two devices today, one later, RSN. And I'll look forward to buying, using and LUVing that device.

Apple actually has a good opportunity to thrash even Amazon in the books market. They just have to keep up the innovation and resist breaking towards the Dark Side of DRM, device lockdowns and other crappage.

Re: I'm going to disagree

!) Switching between tabs is easier than switching between apps, and better facilitates linking, reading and posting to other services.

2) There is already a high degree of standardisation. Any web browser that is at least fairly standards compliant will render most content in a way that is pretty uniform. Web standards are not hugely draining on CPU/GPU, especially as browsers are improved and the devices themselves get more powerful. Certainly not a problem for iPad and Safari. Browsers for smaller devices can be improved to deal with more/complex content too.

3) There is nothing to say these apps are going to be inherently more "monetizable". I highly doubt your oddly high numbers for redesigning a website too, and it has advantages like working across many platforms, not just a minority.

4) They don't need that option on the web. It's been seemingly shown audiences aren't willing to pay for content that's free and just as good elsewhere, especially in this instance with little genuine advantage over browsers.

Re:

Good point!

However, this will no longer be an issue once the government comes in and fixes everything. In the post PRO-IP, post ACTA Web 3.0, each website you use will require its own discreet HDMI cable. And that's the only reason why iPad, in its current form, will fail.

Re:

Re:

They wouldn't have to. They just do UA sniffing and redirect iPad users to the download page for their app.

I've had this issue with Papa John's website. I wanted to order pizza from my phone. I go to their website, and I'm redirected to their mobile site. There's no link ANYWHERE to get to the regular site, even though I'm on a motorola droid that can handle it. Problem is that their mobile site is broken. No matter how hard I try to order pizza, I just can't get through the process.

So, I use the Dolphin browser for Android, and have it switch its UA to pretend to be a regular computer. Now I can browse the REAL website. While I have to scroll around a bit (on my 800px screen), my capable phone can get through their website just fine and order pizza, even through the Javascripty pizza building part.

If they just made ONE website that degraded gracefully, I might try them instead of Dominos next time I'm out and about and want to interactively build a pizza.

An oversized and extremely expensive iPhone when thinking of the 3G model.

Targetted as the netbook killer it fails to even match a netbook. No outputs, no inputs as standard, 4:3 resolution, no true OS, no multitasking, no ability to handle Flash (yet supposedly the best way to view the web)... the list is endless. The Apple Fans will be all over it like a rash but so far nearly everyone I've spoken to who initially raved about it have since cooled off.

For less money you can buy a nice shiny 12" dual core Atom running Windows 7. I'll be waiting to see what happens with the HP Slate.

Re: Re: I'm going to disagree

There are both examples and counter-examples for your point. Sure, HTML beat Prodigy and Blackbird. But TiVo did pretty well with a closed system. XML killed EDI, but no open challenger to eBay has had any luck.

Apple's the 3rd or 4th largest company in the U.S. It's not a foregone conclusion, but it's not impossible that they could affect what everyone agrees on.

And remember, they resisted native apps pretty strongly. Native iPhone apps only appeared because everyone agreed it should work that way.

Re: Re: I'm going to disagree

1) Agreed, and that's why I called it out. However, on my iphone, a tab switch is a click to get the list of tabs, a drag to find my tab, and a tap to get that tab loaded. Switching to a native app is a click to get to the homescreen, a drag to find the page the app is on, and a tap of the icon. Not *that* different.

2) The point about standardization is that the open system encourages publishers to target lowest-common-denominator requirements because they don't know what device people will use. Yes, an iPad-specific website that simply refused to work (or worked poorly) on netbooks, phones, etc, would have similar advantages as an iPad app. But significantly stronger downsides (harder to monetize, customer service issues)

3) Um, Apple sells apps. I have an app in the App Store, in fact. I would never have built it as an ad supported website or a website that required external payments. Living in the app store means exposure to users, sales are easier because users trust Apple with their CC info more than they would trust me, and it's a two-click purchase. It's true that $1M is on the high end for apps or websites. Same argument holds for smaller companies just spending $50k.

4) So why would they bother at all, then? You're saying that publishers are just going to put stuff online for free because there's no point in charging for an app that attempts to add value because people will just get the content online for free? Or am I missing something?

I love discussions like this because the outcomes are easily measurable. I'm still not convinced on iPad, by the way, but I think odds are it will be successful, in the sense that it will be moderately to highly profitable for both Apple and app developers.

Re: Re: Re: I'm going to disagree

The point about standardization is that the open system encourages publishers to target lowest-common-denominator requirements because they don't know what device people will use. Yes, an iPad-specific website that simply refused to work (or worked poorly) on netbooks, phones, etc, would have similar advantages as an iPad app. But significantly stronger downsides (harder to monetize, customer service issues)

Except you're over emphasizing, there's nothing to believe it's "harder to monetize". iPad renders normal browser content and displays it perfectly fine, and good mobile browsers have also taken to task in resizing and displaying already existing sites. The problem you're talking about is somewhat more muted than you're making it out to be at the moment.

3) Um, Apple sells apps. I have an app in the App Store, in fact. I would never have built it as an ad supported website or a website that required external payments. Living in the app store means exposure to users, sales are easier because users trust Apple with their CC info more than they would trust me, and it's a two-click purchase. It's true that $1M is on the high end for apps or websites. Same argument holds for smaller companies just spending $50k.

Um, everyone gets news content for free. There are already existing models that allow for software to be produced cheaper and freely, there's plenty of free apps and the exposure you get is generally no more than usual in a crowded situation with many competing apps. Viewing free online content is no more clicks than viewing or buying an app.

4) So why would they bother at all, then? You're saying that publishers are just going to put stuff online for free because there's no point in charging for an app that attempts to add value because people will just get the content online for free? Or am I missing something?

Because the apps don't offer anything special over the free content that people will continue receiving, especially at the prices they seem to be setting. They also fit in worse with modern news habits, not better. It's the same reason the music industry thought iTunes would save them. They're just re-upping the same content as before but now behind a subscription/paywall.

You'd also be investing a large amount of money for a minority audience compared to producing web content that can be accessed by all and fits in better with those habits.

Re: lack of keyboard

Oh, please.

iPad's GOT a keyboard, and whether a device is touch or not has nothing at all to do with how easy it is to hack. Stupid statement. The iPhone has been jailbroken, and a recent hack for that is alleged to work with the iPad when it releases. We'll see.

There is not loss of function for the user on the iPad. It can be equipped with iWork, or a touch version of it, so there will be very little loss of function per se.

Lots of people use the touch keyboard on the iPhone, including me, and suffer little loss of function. It works fine, and the larger version of it on the iPad should work even better.

Re: Re: lack of keyboard

"Perhaps you should actually USE it before criticizing it?"

Yeah, I was skeptical of the iPhone when it came out (and I'm a long-time Mac geek.) After a friend got one (as sort of an employee bonus--she was skeptical too) I tried it for a little bit and was sold.